A new report from Rabobank shows an increased chance of four-dollar corn this growing season. As 2018 corn planting is underway, the report shows key risks are developing that can drive price volatility and potentially sustain elevated grain prices through the 2018/19 season.
The report explains that while demand is staying firm, the projected corn acres and current global corn stocks are declining compared to the past few years. The report notes that this environment provides little room for production deterioration in the 2018 growing season. Any additional loss of production through acreage or yield loss will put pressure on corn prices.
The Rabobank Pricing Probability model forecasts that there is now over a 50 percent probability that futures prices will remain near to or exceed $4 per bushel through December, and 2018/19 corn has a 24 percent chance of sustaining greater than $4.70 per bushel.